Trading and Clearing the
Argus Sour Crude Index (“ASCI”)
ICE ARGUS SOUR CRUDE INDEX (“ASCI”)
IC E n ow o f fe r s 4 U. S . Gulf-related sour crude products to
o i l m a r ke t p a r t i c i p a n t s globally, including:
• Two I C E OTC Arg u s S o ur C r ud e Ind ex (“ASC I” ) sour crude
d i f fe re n t i a l swa p s (o n a Calendar Month and Trade Month
b a s i s) , a n d
• Two ICE Arg u s S ou r C r ud e Ind ex (“ASC I” ) Fu tu res (one
ou tri gh t , o n e d i ffe re ntial)
Th i s g u i d e is intended to provide essential background on the evo l u t i o n
o f t h e U. S. G u l f Co ast so ur c rude m a rket as it relates to ASCI i n d ex ,
a s we l l a s the instruments ICE has made available for partici p a n t s
in t h o s e m ar ke t s fo r t h e p urposes of hedging or trading. Addit iona l
info r m at i o n o n t h e und e r l ying ASCI index component marke t s a re
ava i l a b l e thro ug h t he re so urces highlighted in this guide.
THE ARGUS SOUR CRUDE INDEX (“ASCI”) GLOBAL CRUDE PRICING AND BENCHMARKS
According to Argus: There are approximately 550 global crude oil streams that
”The Argus Sour Crude Index (“ASCI”) represents the daily value can be identified as individual grades with a multiplicity of
of U.S. Gulf coast medium sour crude, based on physical spot qualities and prices. Only a handful of those grades can be
market transactions. The ASCI index primarily serves buyers called ‘benchmark’ or ‘marker’ grades. The remainder of crude
and sellers of imported crude that need a broader index of U.S. oils price as differentials to those few key benchmarks. With
sour crude value for use in long-term contracts.” the launch of ICE ASCI™ futures, ICE is able to offer ASCI
index sour crude outright and differential futures alongside
The ASCI index is a single price for a basket of three crudes the two key global light, sweet crude futures benchmarks –
– Mars, Southern Green Canyon and Poseidon. Prices are West Texas Intermediate (WTI) and Brent - for the first time.
compiled by Argus from their office in Houston. The ASCI Combined, ICE’s offering allows players to hedge and trade
index is published as a differential to West Texas Intermediate these contracts as outrights and as differentials to each other,
(WTI) crude oil and as a flat price. A document on the Argus representing a full spectrum of marker grades relevant to U.S.-
website describes the ASCI index methodology in detail, and based crude pricing.
is available at: www.argusmedia.com/methodology. More
background on sour grades and their global context is below.
ICE ARGUS SOUR CRUDE INDEX (“ASCI”) 2
GLOBAL PRICING, GLOBAL OIL FLOWS
Oil as a commodity is produced, transported, and refined all over the world. Figure 1 illustrates many of these key flows, and their
FIGURE 1: MAJOR OIL TRADE MOVEMENTS
THE WORLD’S TWO LARGEST CRUDE
BENCHMARKS ARE SWEET GRADES, BUT
318.5 THERE’S A GROWING AMOUNT OF SOUR
CRUDE TO PRICE
23.8 Crude oil can be described in terms of each
101.3 grade’s key characteristics as a hydrocarbon,
64.7 each of which influences the economic yield
119.7 53.1 20.7
25.4 119.4 107.6 of that grade in terms of the refined products
44.5 49 2
25.2 238.3 that flow from that grade, in addition to where
it is located. Terms like ‘light’, ‘sweet’ and
S. & Cent. America 20.0
Europe & Eurasia ‘sour’ are used. WTI and Brent, the two most
Asia Paciﬁc important global crude benchmarks are ‘light
and sweet’, whereas most of the world’s total
crude production, including the ASCI index
Source: BP Statistical Review of World Energy 2009 component grades (such as Mars, Poseidon
and Southern Green Canyon, see below) are
more sour and ‘heavier’ than Brent and WTI, meaning that they are denser and are higher in sulphur by-product, generally making
them less valuable in terms of the products produced in the refining operation. However, much of U.S. Gulf refining capacity has
become well adapted to processing the heavier, more sour grades, and can thus use sour grades that are produced in the U.S.
Gulf or imported from global locales such as the Arab Gulf. As a result, these refiners are able to capture the discounted prices
for sour crudes, relative to lighter, sweeter – and more expensive - grades like WTI and Brent.
FIGURE 2: THE BRENT CRUDE FUTURES CONTRACT: BRENT RELATED PRICING WORLDWIDE
For more than twenty years, Brent has been
the dominant global physical marker crude.
West Texas Intermediate, also a light, sweet
grade, has been the central price hub for
crude oil within North America, although
most of the light, sweet crude being imported
is also priced using the North-Sea produced
Brent grade. Brent prices, by reference,
approximately two thirds of all global physical
crude oil produced. Figure 2 below outlines
various crude markers globally and their price
relationship to Brent:
THE U.S. GULF SOUR CRUDE MARKET
The U.S. Gulf is a key region for the U.S. oil industry, providing at least one-third of U.S. domestic oil production, and containing
around half of U.S. refining capacity (see Figure 3 below). It is logical that U.S. pricing should overlay its key infrastructure. The
ASCI index - and pricing against it - represents such an alignment.
ICE ARGUS SOUR CRUDE INDEX (“ASCI”) 3
U.S. sour crude production has risen sharply FIGURE 3: U.S. PETROLEUM REFINERY CAPACITY, BY REGION CRUDE OIL DISTILLATION
over the past few years, boosting interest
in a U.S. Gulf Coast Sour Crude Index. The
increase in oil production in the U.S. Gulf more
specifically has led to a surge in spot market
trading volumes. U.S. Gulf output of about 1.2
million b/d in 2009 is expected to climb to 1.4
million b/d in 2010 and 1.9 million b/d in 2013.
According to the U.S. Department of Energy,
around 7.5 million b/d of crude oil originating
from countries with predominantly sour
crude production were imported in 2008 (see
Source: Petroleum Supply Annual, Table 36, Biennial Refinery Report
Figure 4 below). This represents close to 75%
of the total average daily U.S. crude imports of approximately 9.7 million b/d (2008). Many of the refiners located in the U.S. Gulf
Coast region have a high degree of upgrading and processing capacity and therefore are specialists in refining sour crude oil.
U.S. Gulf Coast refiners have also increasingly invested in coking facilities which break down residual oils into lighter and lower
FIGURE 4: U.S. GULF SOUR CRUDE IMPORTS BY COUNTRY AND VOLUME
Source: U.S. Department of Energy
WTI PRICE DISCONNECTION VERSUS OTHER DOMESTIC SWEET AND SOUR CRUDES AND BRENT – THE FEBRUARY 2009
DISRUPTION & PRICING ISSUES FOR THE INDUSTRY
In addition to a greater reliance on U.S. Gulf Coast sour crude, the existing predominant U.S. benchmark – WTI – has experienced
significant dislocation from other major global oil markers over the past several years (see Figure 5). Industry participants
increasingly express concerns over WTI’s physical infrastructure, its delivery and flow constraints, and major storage location in
In part, as a result of these factors, in November 2009, Saudi Aramco announced plans to stop pricing its output relative to
WTI and begin pricing relative to the ASCI index for January 2010 crude imports to the U.S. Gulf. Much of the momentum for
the Saudi announcement and industry disquiet stemmed from the dislocation of WTI prices from both U.S. domestic and other
international marker grades in 2008 and repeated most dramatically in February 2009.
ICE ARGUS SOUR CRUDE INDEX (“ASCI”) 4
So what happened early in 2009? Following are some of the points raised by industry commentators:
• The Cushing delivery location for WTI is a pipeline nexus, with no proximity to U.S. Gulf refiners
• A self-feeding ‘reinforcing feedback’ of local storage built up, doubling between December ’08 and March ‘09 (Adding 30+
mil/bbl) to exploit contango price arbitrage available in the market
• This was allied to a de facto one-way ‘lock-in’ effect of pipeline inland flow north out of the U.S. Gulf to Cushing and towards
the Chicago-based refineries – creating a ‘cash & carry’ arbitrage supply loop as U.S. Gulf – Cushing effectively became
disconnected, even within the United States, in price terms
• Early 2009 saw extreme volatility of WTI front monthly spreads, pulling first line flat prices down
• The depth of contango overall and the allied FIGURE 5: BENCHMARK CORRELATION IN 2008/2009: WTI DIVERGENCE FROM BRENT AND
DUBAI (First monthly spread)
instability of term structure became widely
problematic for many market participants
• Collectively, these factors led to WTI
decoupling from other U.S. & international
crude grades, with Mars (effectively close
to the ASCI index number) $3/bbl above,
rather than below WTI. Louisiana Light
Sweet (LLS), a comparable light sweet
crude located in the U.S. Gulf, was as much
as $9.90/bbl above WTI, and a $11.56/bbl
positive differential for Brent was seen,
compared to the more normal $1.00-$1.50/
bbl negative differential
While WTI remains the underlying reference base for ASCI index related sour crude differentials, a possibility exists that the
outright ASCI index price may become more independent of its WTI base, especially if the differentials to WTI continue to be
less stable than the differentials to more globally-traded markers such as Brent.
WHY DOES THE SAUDI PRICING CHANGE MATTER TO THE U.S. OIL MARKETS?
Saudi (generally sour) crude oil forms a large part of the total crude imported into the United States (see imported proportions
in Figure 4 above). Together with the price of WTI (as long as sour crudes continue to be priced in this way), differentials will
continue to be an important part of the overall price of crude oil, ultimately affecting the price products such as heating oil and
gasoline for the U.S. consumer.
Other Arab Gulf producers regard Saudi Arabia as the key bellwether for OPEC decisions, and frequently fall into line behind
Saudi decisions and practice. Saudi Arabia’s break with WTI pricing reinforces the views of some that using sour crude contracts
for pricing sours into the United States is a better mechanism than using WTI futures, whatever the latter’s liquidity, especially
given WTI’s recent dislocations.
This change will likely have knock-on effects for pricing by the very influential Arab Gulf producers, and for the treatment of
other sour crudes such as Urals and Dubai. It may also contribute to Brent becoming even more dominant in global (light sweet)
physical pricing, as WTI’s status in the U.S. is bifurcated by an increasingly independent ASCI index marker. It is likely that OPEC
production will increase in the future, as will Canadian heavy output, especially from unconventional sources such as from oil
shale and oil sands, likely rendering sour crudes an even more important component of the global crude market. The ASCI index
will give importers an identifiable and independent marker for differentials when setting their Official Selling Prices (OSPs), and
ICE ARGUS SOUR CRUDE INDEX (“ASCI”) 5
reduce the need for ad hoc proxy calculations between importers and their customers when WTI fundamentals dislocate.
WHAT IS AN OSP?
OSP stands for Official Selling Price and is the mechanism that the majority of the Middle Eastern producers use to sell their
crude oil. This is generally set on a monthly basis and the producer will use a variety of similar crude price references to calculate
the OSP. In the case of the Saudis, they will generally use the prices of Mars, Venezuelan and Iraqi Basrah Light as a guide for
setting the OSP.
THE ASCI INDEX SOLUTION
Given the growing criticism of WTI as a ‘broken’ benchmark, and the need for both suppliers and customers to negotiate pricing
differentials to WTI, participants have been looking for alternative U.S. benchmarks. As a result, the Argus index, was created to
provide a potential alternative for establishing such differentials (Figure 6).
1. What is the ASCI index?
The ASCI index is a single price for a basket of three crudes – Mars, Southern Green Canyon and Poseidon. Prices are
compiled by Argus from their office in Houston. The ASCI index is published as a differential to WTI and as a flat price.
2. How is the ASCI index calculated?
The Argus Sour Crude Index (“ASCI”) is a trade weighted index using trades in the underlying three grades – Mars, Southern
Green Canyon and Poseidon. The WTI component, to which the differential is added, is assessed at 14:30 EST. The differentials
continue to be assessed up to and including 16:00 EST with the final price published by 18:00 EST.
FIGURE 6: HISTORICAL PRICING DATA FOR ASCI VERSUS WTI AS A DIFFERENTIAL ASCI INDEX COMPONENT SOUR CRUDE
Three physical grades are used in the
compilation of the Argus Sour Crude Index
(“ASCI”). This helps to enhance its robustness
for deriving an effective settlement price on
which to base a futures [or over-the-counter
swaps] market. The three grades, Mars,
Poseidon and Southern Green Canyon have a
combined daily production of close to 1 million
b/d with spot trade regularly exceeding 50%
of the total daily production, according to
Argus. The Argus Sour Crude spot market
trade is 7 times larger than the equivalent
for Dubai and almost double the size of both
Source: Argus Urals markets combined (Source: Argus ASCI
• Mars: Mars is the crude stream with the highest volume of the three grades, producing around 350,000 b/d in September
2009 according to the field operator website www.marscrude.com. The blend primarily comes from the Mars field, which is
operated by Shell with BP as a minority partner. The other field in the system is called Ursa and is also operated by Shell with
BP, ExxonMobil and Conoco as minority partners. The Mars field, which lies in the Gulf of Mexico about 130 miles southeast
of New Orleans, is connected via the Equilon-operated pipeline to the Clovelly storage facility that is part of the Louisiana
Offshore Oil Port (LOOP).
ICE ARGUS SOUR CRUDE INDEX (“ASCI”) 6
• Southern Green Canyon: Daily volumes are estimated to be around 230,000 b/d with the largest share coming from the
Atlantis field, according to the website www.cameronhighwayoil.com). The Atlantis field is operated by BP with BHP Billiton
as a significant equity holder. The other fields in the system include Holstein and Mad Dog (100,000 b/d). Output from the
Atlantis, Holstein and Mad Dog fields is shipped via the Cesar Oil pipeline, operated by the Mardi Gras Transportation system,
to the Cameron Highway Offshore Oil Pipeline system which will transport the oil to the Gulf Coast refineries.
• Poseidon: Production currently stands at about 225,000 b/d. Like the Mars and Southern Green Canyon fields, Poseidon is a
pipeline network. Enterprise Products Partners have a 36% share, as do Shell Pipeline Company. Marathon has a 28% stake in
WHAT TYPE OF PRICING IS RELEVANT TO AND CAPTURED BY THE ASCI INDEX, AND WHAT TYPE OF TRANSACTIONS ARE
LIKELY IN ASCI INDEX RELATED PRODUCTS?
It is likely that market participants may trade and hedge around the 5 or 10 day pricing and trading windows for monthly OSP-
related Arab Gulf, imported cargoes into the U.S. Gulf for dates around the 25th-30th of each month or between the 25th and
the 5th of the following month in calendar terms. (These represent the first 5 or 10 days of a trade month, by which the physical
nominations to move landed crude by inland pipeline are organized).
It is possible that increasingly flexible contract terms may become more common as importers and refiners use more monthly
average pattern contracts (popular elsewhere in oil markets), which will appeal to many refiners, as it reduces price volatility and
increases logistical and price options. If other Arab Gulf countries such as Kuwait, and more openly-traded Iraqi grades follow
suit, interest will increase further in ASCI index outrights and differentially-traded pricing.
Inter-month spreads in either OTC markets or futures differential and outright contracts will allow hedgers to move their price
exposure along the timing curve as their physical requirements change. These contracts will also enable traders to take a view on
price evolution in relative domestic sweet/sour differentials at different points along the forward price curve, and also in relation
to such global sweet markers as Brent.
Trading against the outright future or differential can also allow market participants to take a view on outright sour crude prices
in a key production, refining and import region of the United States, and a sweet/sour differential which marks one of the major
global spreads of its type. Sweet/sour spreads represent a play on the input costs of simple against complex refining, and of the
likely output levels of OPEC heavier, more sour crudes against other sections of global crude output. In short, many key refining
and production margins are available through such instruments and related WTI and Brent products.
FIGURE 7: ASCI INDEX (Outright)
TRADING IN ICE ARGUS SOUR CRUDE INDEX
(“ASCI”) FUTURES AND OTC SWAPS
1. Outright: The ICE Argus Sour Crude Index
(“ASCI”) future allows market participants
to hedge or trade around the outright flat
price of a representative basket of U.S. Gulf
sour crudes. Participants will be able to
match the exposure of U.S. Gulf-produced
or U.S. Gulf-delivered sour crudes with a
single instrument (Figure 7).
2. Inter-commodity spreading: The ICE
ICE ARGUS SOUR CRUDE INDEX (“ASCI”) 7
Argus Sour Crude Index (“ASCI”) Differential Future and ASCI Index Differential OTC Swaps represent a first order inter-
commodity quality spread, a direct spread between U.S. Gulf sour crude prices and Mid-continent WTI light sweet crude
prices (see Figure 8 below). These can be traded on ICE in an OTC swap form as differentials over a calendar month period,
or as trade months, with the ’bullet’ differential future providing such pricing and trading facility in a futures environment.
3. The ICE Argus Sour Crude Index (“ASCI”)
FIGURE 8: ARGUS SOUR CRUDE INDEX vs WTI
Future versus ICE Brent Future as a flat price
against a flat price will also represent an
additional global sweet/sour differential to
be traded in any single maturity, or via boxes
to be traded or hedged against ICE Brent
across any chosen part of these two crude
benchmarks’ respective forward curves.
4. Intermonth spreading: ICE Argus Sour
Crude Index (“ASCI”) intermonth spreads
in the ICE Argus Sour Crude Index (“ASCI”)
Differential Future will enable participants to
trade around their forward view of how this
important sweet/sour differential will evolve
in price terms, which can be affected by:
a. global fundamental factors in oil, the overall economic outlook,
b. the proportion of OPEC (sourer) crudes within the overall crude production picture,
c. the relative demand for light-end against middle-distillate products,
d. the quantity of oil in storage, and
e. the relative fundamentals of the U.S. Gulf against Mid-continental conditions, among others, at different points in time.
WHAT ARE THE IMPLICATIONS OF THESE CHANGES FOR THE BRENT MARKET?
As third-party commentators have said, the ASCI index does not offer a threat to ICE Brent as the leading global physical light,
sweet crude marker price. Although Brent is a light, sweet crude, unlike WTI, Brent has a number of factors that differentiate it
from WTI to make it a uniquely successful global benchmark:
Brent is a seaborne, globally traded and referenced physical crude. Because WTI cannot be traded and transported outside of
the United States, WTI cannot truly reflect global underlying physical fundamentals as efficiently.
Additional jurisdictions, such as Australia, are increasingly using Brent as a pricing reference, particularly in Asia.
Physical Brent is closer to the ASCI index component grades in specification than WTI, and as a stream has become more sour
as the Buzzard field has been added to Forties, forming part of the wider Brent complex.
ICE Brent already trades on a differential basis to Dubai, the most popular sour crude marker in Asia, and there is every reason
to expect ASCI index instruments to also trade and price in reference to ICE Brent in a similar manner. The two sweet/sour
differentials: ICE Brent/Dubai and ICE Brent/ASCI index may well compete to be the dominant global sweet/sour differential, as
they represent key pricing ‘bridges’ globally.
The following charts (Figure 9 and Figure 10), together with Figure 5 above, demonstrate that Brent’s pricing behavior has
ICE ARGUS SOUR CRUDE INDEX (“ASCI”) 8
remained within expected norms against key global references, while WTI has periodically disconnected. Figures 9 and 10 also
show Brent’s relative price stability, and price ‘bridge’ status between WTI and the U.S. Gulf sour crudes. Arguably ship borne
Brent is often more closely correlated with U.S. Gulf sours than their U.S. light sweet equivalent, WTI, which is of relevance when
an increasing proportion of the sour crude volume is being priced in terms of ship borne, imported, and hence internationally-
FIGURE 9: ASCI INDEX CORRELATIONS - BRENT, WTI & WTI (Mars as Proxy)
FIGURE 10: ASCI INDEX CORRELATIONS - BRENT, WTI & WTI (5-day av. prices and trend)
ICE ARGUS SOUR CRUDE INDEX (“ASCI”) 9
THE ICE ARGUS SOUR CRUDE INDEX (“ASCI”) PRODUCT RANGE
• ICE Argus Sour Crude Index (“ASCI”) Futures Contract Specifications
• ICE Argus Sour Crude Index (“ASCI”) Differential Futures Contract Specifications
• ICE Argus Sour Crude Index (“ASCI”) Differential Trade Month Swap Specifications
• ICE Argus Sour Crude Index (“ASCI”) Differential Calendar Month Swap Specifications
ICE ARGUS SOUR CRUDE INDEX (“ASCI”) FUTURES AND DIFFERENTIAL FUTURES
ICE launched the ICE Argus Sour Crude Index (“ASCI”) Futures Contracts to:
• Create a liquid sour crude benchmark to compliment its existing ICE Brent and ICE WTI Futures contracts. This will provide
participants with the opportunity to access some of the most liquid global oil grades in a single electronic marketplace;
• Facilitate trading in the ASCI index/Brent and ASCI index/WTI Futures spreads;
• Provide market participants margin offsets where possible between the ICE Brent Crude Futures contract, the ICE WTI Crude
Futures contract and the ICE Argus Sour Crude Index (“ASCI”) Futures contract; and
• Allow market participants to manage exposure to either the differential to WTI or the flat price.
Only ICE can offer both ASCI index futures (outright and differential) alongside WTI and Brent futures via a single electronic
platform. The four futures combined allow multiple trading and hedging opportunities in the three key grades of crude oil, as well
as spreading across grades and time periods.
Details of each of the ICE Argus Sour Crude Index (“ASCI”) products are available via the following links:
ICE Argus Sour Crude Index (“ASCI”) Differential OTC Swaps
In addition to the two ICE Argus Sour Crude Index (“ASCI”) futures, ICE also offer cleared differential swaps against the ASCI
index differential (to WTI) in both calendar month and trade month tenors.
These allow trades and hedgers of ASCI index related sour crudes to:
• Hedge and trade around ASCI index related differentials in either calendar month or trade month pattern;
• Match current or future physical contract terms as they see fit;
• Utilize logical margin offsets against other relevant OTC markets such as WTI first-line swaps, Brent and Brent/Dubai
instruments to maximize capital efficiency
Summary of ICE OTC Cleared Oil and other energy products:
• ICE offers over 100 cleared OTC oil products across all major global crudes and refined products in both outright form and as
differentials. Please use the following link to reach a full list of ICE cleared OTC oil products
More ICE Crude Oil and Refined Products
ICE ARGUS SOUR CRUDE INDEX (“ASCI”) 10
ICE OTC CLEARING: WHY AND HOW?
Elimination of Counterparty Risk
• OTC clearing virtually eliminates counterparty risk associated with traditional bilateral trades. The clearing house acts as a
central counterparty for all trades. Clearing gives market participants the security of futures transactions with the flexibility of
• Margining removes the daily rigor of back office processes associated with bilateral trades via letters of credit. It outsources
collateralization to a guaranteed and financially secure third party
• By carrying both sides of the transaction, the systemic risk is naturally diversified, while conservative volatility-based margining
provided by the clearing house creates security for all involved
Increased trading opportunities
• Deferring to cleared business eliminates operational distractions and complexity related to bilateral credit issues around
trading and hedging
• Participants benefit from the fact that OTC trades are centrally cleared, freeing the use of bilateral credit lines - opening up a
larger and broader universe of market participants, including those who might otherwise be excluded
Efficient capital flows
• Clearing satisfies increasingly rigorous capital requirements placed upon market participants by regulators and policymakers
• A trader who has reached his own desk limits in capital terms, but who sees a promising trading opportunity, can add additional
exposure with no further credit exposure, if the marginal OTC position is sent for clearing, rather than added to a bank’s or
trading firm’s own net credit position
Streamlining back office operations
• Offsets between exchange-traded and bilateral OTC instruments to a single clearing house allow reduced capital reserve
requirements and margin, reduced confirmation errors, and other back office bottlenecks
• Clearing provides settlement values, aiding price discovery and risk monitoring via objective fair-value mark-to-market for OTC
• The posting of initial and variation margin through clearing houses ensures a degree of security of performance and payment
that cannot be matched by even the most highly secure single counterparties in the bilateral OTC trading realm
WHY CLEAR WITH ICE?
Global market synergies
• If a customer is trading ICE oil futures such as Brent, WTI and Gasoil, it makes sense to also clear strongly correlated instruments
offering related OTC bilateral exposure to such global benchmarks through the same clearing house and thus get the benefit
of direct cross-margining and offsets across screen-traded and bilateral markets, for the most efficient and operationally
simple employment of capital in trading and hedging energy
• Companies actively trading the energy complex across diverse derivative products in Brent, WTI, Gas[oil] and Emissions will
significantly benefit from related efficiencies across trade capture, confirmation, margining and reconciliation
State of-the-art cross-margining optimizes capital efficiency
• Margin offsets between screen-traded futures and bilaterally matched OTC markets of up to 95% are available to ICE Clear
customers in markets such as oil inter-commodity spreads
• Back office processes are simplified and reconciliations easier to process via a single clearing house that handles ICE on-screen
execution and clearing of related OTC instruments
ICE ARGUS SOUR CRUDE INDEX (“ASCI”) 11
• ICE’s settlement curves used for margining such bilateral instruments are independently and directly sourced from a pool of
established major trading entities, and considered highly reliable for margining purposes establishing true fair value
The decision to switch pricing to the ASCI index by such a significant U.S. Gulf importer likely marks a period of increasing
reflection and uncertainty for U.S. domestic crude pricing, especially of sour crudes of the type that comprise the ASCI index.
WTI remains the major U.S. domestic light sweet benchmark, and a key underpinning of the ASCI index. Brent continues to grow
in significance as the most common international physical crude benchmark, and is continuing to enhance its significance in
The ICE Argus Sour Crude Index (“ASCI”) product offering allows traders and hedgers in any and all of these markets to access
all, and intervening spreads and differentials at a single point of delivery, and to maximize clearing, processing and capital
efficiencies through one provider.
For more information please contact:
US: Jeff Barbuto Europe: Paul Wightman Asia: Jennifer Ilkiw
+1 646 733 5014 +44 (0)20 7065 7744 +65 6594 0161
Jeff.Barbuto@theice.com Paul.Wightman@theice.com Jennifer.Ilkiw@theice.com
US: Yvonne Betts Europe: Deborah Pratt Asia: Julius Foo
+1 713.890.1224 +44 (0)20 7065 7734 +65 6594 0162
Yvonne.Betts@theice.com Deborah.Pratt@theice.com Julius.Foo@theice.com
ICE ARGUS SOUR CRUDE INDEX (“ASCI”) 12
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or call ICE Futures Europe.
Price transparency is vital to efficient and equitable markets. ICE A complete list of specifications is available at: https://www.theice.
offers unprecedented price transparency and ensures that full depth com/productguide/productDetails.action?specId=909
of market is shown. Trades are executed on a first-in/first-out basis,
ensuring fair execution priority. ICE also displays a live ticker of all deal
terms and maintains an electronic file of all transactions conducted in
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This brochure serves as an overview of the Brent and WTI futures and options markets of ICE Futures Europe. Examples and descriptions are designed
to foster a better understanding of the Brent and WTI crude oil futures and options market. The examples and descriptions are not intended to serve as
investment advice and cannot be the basis for any claim. While every effort has been made to ensure accuracy of the content, ICE Futures Europe does
not guarantee its accuracy, or completeness or that any particular trading result can be achieved. ICE Futures Europe cannot be held liable for errors
or omissions in the content of the brochure. Futures and options trading involves risk and is not suitable for everyone. Trading on ICE Futures Europe is
governed by specific rules and regulations set forth by the Exchange. These rules are subject to change. For more detailed information and specifications
on any of the products traded on ICE Futures Europe, contact ICE Futures Europe or a licensed broker.
IntercontinentalExchange is a Registered Trademark of IntercontinentalExchange, Inc., registered in the European Union and the United States. ICE
is a Registered Trademark and Marque Deposees of IntercontinentalExchange, Inc., registered in Canada, the European Union, Singapore and the
United States. ICE Futures U.S. and ICE Futures Europe are Registered Trademarks of IntercontinentalExchange, Inc., registered in Singapore and the
United States. ICE Clear U.S. is a Registered Trademark of IntercontinentalExchange, Inc., registered in the European Union, Singapore and the United
States. Russell 1000 is a Registered Trademark of the Frank Russell Company. U.S. Dollar Index is a Registered Trademark of ICE Futures U.S., Inc.,
registered in the United States. USDX is a Registered Trademark of ICE Futures U.S., Inc., registered in Japan and the United States.
“Argus”, “Argus Sour Crude Index” and “ASCI” are trade marks of Argus Media Limited and are used under license. All intellectual property rights in
the Argus indices referred to herein belong to Argus Media. Argus Media accepts no liability to third parties arising from or in connection with any
use of the Argus indices.